"The Board will continue to assess the outlook and adjust policy as needed to foster sustainable growth in demand and inflation outcomes consistent with the inflation target."
-The Reserve Bank of Australia
The latest Reserve Bank of Australia monetary statements does not provide any new clues of the outlook for interest rates. It remained unclear whether there is still a scope to cut the cash rate further if necessary. Moreover, the nation's central bank cut its short-term forecast for economic growth, as mining has been unwinding faster-than-expected and a recovery in China is unlikely this year. The RBA now sees the economy to grow 2.25% in 2013 and 2.5% next year. The central bank said that its outlook for mining investment was revised downward after capital expenditure survey indicated a significant drop in resources industry spending and equipment imports on falling commodity prices, especially in the coal sector.
However, the central bank expects that by 2015 the nation's economy could be expanding strongly, with the nation's GDP growing 3.5% or even more as the important gas projects come on stream, while companies in other sectors run out of spare capacity and invest more to meet increasing demand. The investment revival is expected in the non-resource sector and sustainability of exports would be propped up household consumption increasing in line with its long-run average.
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